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Highlights: [•] We examine unconditional educational returns in India's formal labor markets. [•] We find that primary education benefits women more than men in the middle of the wage distribution. [•] Post primary education benefits women more (less) than men above (below) the median. [•] These unconditional impacts of education on wage distributions are critical for targeting education policies to reduce wage inequality. [Copyright &y& Elsevier]

Abstract: This paper estimates the distribution of educational returns by gender for India. While previous studies focus on mean returns, the variance of educational returns has important implications for policy-making and micro-level decision making with respect to education. If the variance of educational returns is large, it can leave large sections of the population with negative returns; if the variance of educational returns is gender specific, it can influence households’ decisions to educate girls versus boys. Our econometric results provide evidence that India''s labor markets are characterized by significant uncertainty and that the uncertainty is systematically larger for women. [Copyright &y& Elsevier]